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By admin 2018-07-12

Cotton futures are markedly lower overnight as the Trump administration proposed an additional $200 billion tariffs late Tuesday afternoon. The new U.S. tax calls for a 10% levy on an expanded list of imported Chinese goods. The cotton market’s response was to promptly drop well over 200 points lower. Thus far, volume has been moderate, with 5,000 plus contracts traded.This latest U.S. tariff effort is in response to China’s retaliatory actions to the initial $34 billion tariffs the U.S. implemented last Friday. The aim of the Trump administration is to bring China to the negotiation table. However, fears of additional Chinese sanctions has the cotton, grains, and financial markets all swirling lower this morning.Tomorrow, USDA will issue its weekly sales and exports data (8:30 eastern), along with its monthly supply-demand information (noon eastern). Those reports would have to contain extremely friendly news in order to negate the current negative pall cast by this latest trade war twist over the cotton market.